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Understanding Home Value
November 10th, 2015 10:49 AM

UNDERSTANDING HOME VALUE

Barbara’s Blog:

Over time, the worth of a house will fluctuate up and down.  Home values appreciate in the long term for the most part.  But in real estate, there are no guarantees.  

The economy is believed to be the biggest factor affecting real estate appreciation.  It goes without saying that mortgage rates, employment, job growth, government programs and some other national factors have a definite effect on a property’s value.  However, a home’s value and the elements that play the most significant role in its appreciation depend on the local economy and housing market.   Also taken into consideration is the condition and appearance of the home, and the community in which the home resides. 

A few weeks ago, we received an e-mail from a customer who purchased a home from us in 2005, at the very peak of Florida home prices.  She complained that because of the way we priced the home for sale, she has lost $100,000.  First, since she still owns and lives in the home, she has not really lost anything.  Prices could eventually rebound close to the 2005 levels and each year has brought steady appreciation.   Until she sells the home, depending on market values at the time, she has lost nothing.  Second, it is important to understand that the market sets home prices, not the real estate agents.  Market value is determined when reasonable and knowledgeable buyers and sellers agree on a sales price. 

Property values shift for different reasons.  Appreciation is tied to many factors, and local appreciation values cannot be compared to other communities or other states.  Realtors will have all the facts, figures and data needed to set the appropriate sales price.  So, “don’t shoot the messenger.”  

Written by Barbara Doeringer


Posted in:Real Estate
Posted by Allen Doeringer on November 10th, 2015 10:49 AMPost a Comment

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